Jun. 25, 2023
In regards to allowing derivative holders shareholder voting rights I would like to submit my public comment in strong opposition to this proposal. Individuals and institutions frequently purchase derivative positions without ever intending to aquire or hold the underlying asset. Highly leveraged derivatives could be used to gain an oversized voting position in a company that the owner of that position has no intent of ever purchasing shares in. This rule would be highly damaging to actual shareholders with long term interests in the company. Furthermore, fairly and accurately calculating the voting shares equivalency of derivative contracts would be no easy task as delta values are ever changing. A single call contract could have massive swings in delta value in a day, while 100 shares will be 100 votes every day. In the event that the parties selling derivitves are not 100% delta hedged at the time voting rights are calculated we get a potential scenerio where there are more votes alloted than there are outstanding shares. This proposed rule change undermines shareholder rights, and the foundations of corporate democracy. Please vote against this.